Hong Kong and Singapore VUL / Universal Life Glossary (English–Chinese)

A life policy that places lifelong death cover and an account whose investments the owner selects and whose risk the owner bears in a single contract. Singapore high-net-worth VUL is classed as an investment-linked policy and is usually limited to accredited investors; Hong Kong has no regulatory class of that name (applies: mainly Singapore).

A life policy in which premiums, net of charges, go into an account that earns interest at a crediting rate declared by the insurer, with premiums and sum assured adjustable within the terms. Hong Kong traditional UL is generally not Class C and is governed by GL16 (applies: Hong Kong).

Universal life whose cash value is formed wholly or partly by reference to the performance of an index. The IA and HKMA circular of 2025-03-13 places it in Class C (linked long term) business, and the case discussed is one sold to professional investors (applies: Hong Kong).

A Hong Kong life product in which premiums are invested in chosen funds and the value moves with fund unit prices. It is Class C, its sale is governed by GL26, and the retail version is also subject to SFC requirements on offering documents (applies: Hong Kong).

A Singapore policy whose value is linked to the performance of chosen sub-funds, with the investment risk borne by the owner. Retail ILPs are governed by MAS Notice 307; high-net-worth VUL is a higher-threshold form within the category (applies: Singapore).

An investment-type policy issued by private placement to high-net-worth investors, with a higher degree of investment discretion and often linked to trusts or family offices. This site lists it as one row in the comparison table only; see ppli.com.sg (applies: both places).

The balance of the assets in the policy account, measured at market value or at the declared rate, and the base for most charges. It is not the amount that can be withdrawn; surrender charges and amounts owed are deducted on surrender (applies: both places).

The amount recoverable on terminating the policy, usually account value less surrender charges and amounts owed, and often below premiums paid in the early years. Under CRS, insurers report the cash or surrender value (applies: both places).

In Hong Kong traditional UL, the rate declared by the insurer at which the account earns interest; the part above any guarantee is adjustable. Historical crediting rates do not indicate future results (applies: Hong Kong).

The crediting floor written into the contract: however low the declared rate, the account is credited at no less than this. Some products carry one. The guarantee is a contract term, not a government assurance, and the part above the floor is not guaranteed (applies: Hong Kong UL).

Under GL16 the IA requires insurers to disclose on their websites each year the historical crediting rates of every universal life product series with new policies issued since 2010 and still in force, weighted by account balance and excluding one-off bonus interest; the revised GL16 took effect on 2026-03-31, and the look-back period follows the current IA text (applies: Hong Kong).

The amount the insurer pays on the death of the life assured. Common formulae are "the higher of sum assured and account value" and "account value plus a fixed amount"; the policy contract prevails (applies: both places).

The IFEC page states that since 2015-01-01 ILAS insurers should provide a death benefit of no less than 105% of account value. How this applies to IUL follows the annex to the circular of 2025-03-13 and the product documents (applies: Hong Kong).

The difference between the death benefit and account value, that is, the pure protection the insurer actually carries, and the base for the cost of insurance. It usually shrinks as account value rises (applies: both places).

The holder is the contracting party and exercises the policy rights, the life assured is the person on whose life the policy is written, and the beneficiary receives the proceeds. The three may be different people, and the holder must have an insurable interest in the life assured (applies: both places).

Changing the life assured to another person where the policy terms allow, usually subject to the insurer's underwriting approval and possibly carrying tax and CRS consequences. The practice for participating policies is on wholelife.hk (applies: both places).

Transferring all or part of the policy rights to another party, commonly by pledging the policy to a bank for financing. After assignment, exercising certain rights (such as cooling-off cancellation) may require the lender's consent (applies: both places).

In a Singapore high-net-worth VUL, the bank that safekeeps the account assets in a segregated custody account. The policy is still issued by the insurer, and the owner's rights follow the policy terms (applies: Singapore VUL).

The institution nominated by the owner to manage the account assets within the investment mandate (limits on eligible assets, concentration, cash ratio and the like); the insurer usually gives no investment advice, and the Product Summary prevails (applies: Singapore VUL).

Paying the premium or funding the account with insurer-approved assets rather than cash. Whether assets can be transferred, how they are valued and whether tax consequences arise follow the product documents and professional advice (applies: Singapore VUL).

The currency in which premiums, account value and benefits are denominated is the policy currency. When the underlying asset currency or the owner's spending currency differs from it, the owner bears the exchange movements (applies: both places).

The two beneficiary nominations under Singapore's Insurance Act: a trust nomination is limited to a spouse and/or children and cannot be changed unilaterally; a revocable nomination is revoked when the policy is assigned (LIA, 2026-03) (applies: Singapore).

The regulator of the Hong Kong insurance industry, supervising insurers and insurance intermediaries and issuing the GL series of guidelines and circulars; some circulars, such as those on IUL and the premium financing inspection, are issued jointly with the HKMA (applies: Hong Kong).

The Hong Kong banking regulator. When banks sell policies as insurance intermediaries or provide premium financing, their conduct is also supervised by the HKMA, which issues joint circulars with the IA (applies: Hong Kong).

The regulator of Hong Kong's securities and futures markets, which makes the professional investor rules under the Securities and Futures Ordinance and sets requirements for the offering documents of retail ILAS (applies: Hong Kong).

The numbered regulatory guidelines issued by the IA: GL15 on underwriting Class C business, GL16 on underwriting long term business other than Class C, GL26 on the sale of ILAS, GL28 on benefit illustrations, GL29 on the cooling-off period and GL30 on the Financial Needs Analysis (applies: Hong Kong).

The class of long term business in Part 2 of Schedule 1 to the Insurance Ordinance whose cash value is linked to an index or funds, governed by GL15, GL26 and related guidelines. IUL and ILAS fall in this class; traditional UL usually does not (applies: Hong Kong).

The investor category defined by the Securities and Futures Ordinance and Cap. 571D; one individual limb is a portfolio of at least HK$8 million, text in force prevails. The IUL circular treats PIs as the target buyers (applies: Hong Kong).

The assets counted towards the individual HK$8 million threshold under the PI rules; by the definition in the 2002 Legislative Council brief, only securities, certificates of deposit and money held by a custodian count, so real property is excluded; the treatment of joint-account shares follows the text in force (applies: Hong Kong).

The procedure under GL30 for assessing a customer's financial position and protection needs before a product is recommended. Where premium financing is involved it must cover the customer's liabilities and whether existing policies are already pledged (applies: Hong Kong).

The questionnaire used in ILAS sales to assess a customer's risk tolerance, part of the GL26 sales process; specific requirements follow the GL26 text (applies: Hong Kong).

The standardised disclosure document the IA prescribes for particular sales situations. This site covers the premium financing version (IFS-PF) and the Mainland policyholder version (IFS-MP); for ILAS the IFS must be completed for new and top-up applications (IFEC) (applies: Hong Kong).

Issued by circular on 2016-07-08 and applicable from 2016-09-01 to new applications for individual long term policies by customers holding a Mainland resident identity card; the customer may not elect not to sign (extract from the IA circular) (applies: Hong Kong).

The period after application within which the policy can be cancelled and the money recovered. For Hong Kong life policies it is 21 calendar days, running from delivery of the policy or the cooling-off notice, whichever is earlier (GL29); Singapore calls it the free-look period (applies: Hong Kong).

A recorded telephone call made within 5 working days of ILAS policy issue by a staff member who was not involved in the sale and has no financial interest in it, confirming that the customer understands the policy and its rights and obligations (IFEC, 2023-02-20) (applies: Hong Kong).

The levy the IA collects on policies, 0.1% of premium since 2021-04-01 and capped at HK$100 per policy year for long term policies; the IA's current announcement prevails (applies: Hong Kong).

The independent Hong Kong body that handles personal insurance claims disputes with member insurers, subject to a monetary cap (the Lloyd's summary of 2025-06 gives HK$1.5 million, secondary); its current terms of reference prevail (applies: Hong Kong).

The scheme Hong Kong proposes to establish to protect policyholders if an insurer becomes insolvent. The Financial Services and the Treasury Bureau (accessed 2026-10-22) says it is still in preparation, and there is currently no scheme covering life policies (applies: Hong Kong).

The ratio of dividends actually paid on a participating policy to the non-guaranteed dividends illustrated at the point of sale, published under GL16. It is historical data and does not indicate future results; see wholelife.hk (applies: Hong Kong).

Singapore's central bank and integrated financial regulator, supervising banking, insurance and securities and issuing rules such as Notice 307. MAS regulation is not a guarantee of policy returns (applies: Singapore).

The investor category defined in section 4A of the SFA. An individual must meet one of net personal assets above S$2 million (primary residence counted at no more than S$1 million), net financial assets above S$1 million, or income of at least S$300,000, and opt in (applies: Singapore).

When computing an AI's net personal assets, the value of the primary residence net of any secured credit facility counts for at most S$1 million (SFA section 4A(1A)). The MAS FAQ explains it as the home where the investor lives most of the time, which may be in Singapore or overseas (applies: Singapore).

An individual who meets the AI criteria must expressly opt in before an institution treats them as an AI; the regime has applied since 2019-01-08, with transitional arrangements for existing customers (MAS FAQ, 2019-02-04). AI status does not relieve the institution of its duty to assess suitability (applies: Singapore).

Since 2012-01-01, before recommending an unlisted specified investment product (including an ILP) to a retail customer, an institution must assess the customer's investment knowledge and experience (FAA-N16 paragraph 16). This site has not verified the specific arrangements for accredited investors item by item (applies: Singapore).

The concise document that accompanies products such as ILPs, summarising features, charges and risks. Full charges follow the PHS, the Product Summary and the policy contract (MoneySense) (applies: Singapore).

The insurer's document describing the product's terms, charges and risks; together with the PHS and the policy contract it forms the complete source of charge information (MoneySense, 2026-09-28). Content varies by product (applies: Singapore).

The 14-day review period Singapore life insurers give, running from the day the policy documents are received, with the full premium refunded less costs the insurer has incurred such as medical examinations (MoneySense, 2026-05-11) (applies: Singapore).

Administered by the SDIC, it protects only contractually guaranteed benefits, subject to caps; investment-linked policy benefits tied directly to the underlying net assets are outside its coverage (applies: Singapore).

The independent Singapore body that handles disputes between consumers and financial institutions through mediation and adjudication, with an adjudication cap of S$150,000 per claim (website, undated) (applies: Singapore).

MAS guidelines effective 2024-05-30 and applicable to all financial institutions, making the board and senior management responsible for delivering fair dealing outcomes to customers (applies: Singapore).

The MAS notice setting out customer due diligence for direct life insurers, most recently amended on 2025-06-30. Its guidelines require additional checks for non-face-to-face verification; whether to accept remote applications is for each insurer to decide (applies: Singapore).

The protection charge deducted from the account, calculated on the net amount at risk and the age of the life assured; it usually rises with age and is not necessarily guaranteed and may be revised (MoneySense) (applies: both places).

The percentage deducted from each premium before it enters the account, the mirror image of the premium allocation rate in a Singapore ILP. The rate and duration follow the Product Summary; this site lists no product's charge rates (applies: both places).

In an ILP, the proportion of each premium used to buy fund units, with the remainder deducted as up-front charges (MoneySense, 2026-09-28). The rate varies by product and policy year; this site gives no figures (applies: Singapore).

Fixed monthly or annual deductions for administering the policy. Whether they may be revised and whether a guaranteed maximum applies follow the policy contract (applies: both places).

The charge deducted on early surrender or large withdrawals, usually declining by policy year, and one reason early surrender value is below premiums paid; the duration follows the policy contract (applies: both places).

The difference between the buying and selling price of ILP fund units. MoneySense (2026-09-28) says it is typically around 5% and covers distribution, marketing and administration costs; the actual level follows the product documents (applies: Singapore).

The guaranteed maximum is the contractual ceiling; the current charge is the level actually deducted now, which may be revised but not above the ceiling. KPMG (2025-04, secondary) says Hong Kong IUL usually carries a guaranteed minimum crediting rate and guaranteed maximum charges (applies: Hong Kong).

Benefits the contract does not promise, such as the part of the crediting rate above the floor, dividends, investment returns and account value. Non-guaranteed figures in an illustration may turn out higher or lower than the actual result (applies: both places).

The document showing how policy values would develop under assumed conditions. Singapore ILP illustrations must include a 0% return column and a statement that the policy value may fall to zero and the policy terminate (LIA); an illustration is not a promise (applies: both places).

The IA's practice guidance caps the return rates used in sales illustrations for participating policies: 6% for HKD policies and 6.5% for non-HKD policies, effective 2025-07-01. It constrains illustrations only, not actual payouts; see wholelife.hk (applies: Hong Kong).

When an investment-linked policy is cancelled during the cooling-off period, the insurer may adjust the refund for market value movements; under paragraphs 5.12–5.13 of the SFC Code on Investment-Linked Assurance Schemes the adjustment may reflect only the loss on realising the assets, not issuance expenses or commission (insurers' public articles serve as supplementary accounts) (applies: Hong Kong).

Termination of the policy by the insurer when account value is insufficient to pay charges due and the owner does not top up within the grace period. Cover stops on lapse; whether any value remains recoverable follows the policy contract (applies: both places).

An arrangement in which the customer borrows from a lender to pay the premium of a life policy and assigns all or part of the policy rights to the lender (IA circular definition). This site lists no loan ratio or interest rate (applies: both places).

The standard disclosure document annexed to the IA circular, to be completed for every new application intended to use premium financing and signed and dated by the customer before the policy is issued (applies: Hong Kong).

A situation in which, if the lender demands repayment before the policy matures, the customer cannot repay in full from own funds and can only draw on the surrender value of the policy being bought. This is the IA circular's definition (applies: Hong Kong).

A footnote to the circular suggests disclosing the ratio of the loan amount to the customer's existing own financial resources, to help the customer understand the risk. This site gives no ratio, still less presents any as a reasonable level (applies: Hong Kong).

The circular requires confirmation, at minimum, that the customer has sufficient resources to pay the self-funded portion, to repay principal and interest over the full tenor, and to settle the debt if the lender demands early repayment (applies: Hong Kong).

The circular requires insurers to verify the assets and income of financed customers and apply reasonable haircuts: jointly held assets by share of ownership, encumbered assets at net value; the primary residence is usually not accepted as proof of assets (IA, 2022-04-01) (applies: Hong Kong).

When the value of pledged assets falls or no longer meets the lender's requirements, the lender demands additional collateral or repayment. If the shortfall is not met, the collateral may be realised, including by surrendering the policy (applies: both places).

HIBOR is the Hong Kong dollar interbank offered rate, SOFR the US dollar secured overnight financing rate and SORA the Singapore overnight rate average. Financing rates are often set as a spread over a benchmark, with terms varying by bank (applies: both places).

Tax status determined under each jurisdiction's rules: Hong Kong's AEOI test looks at residence and days of presence, Singapore at citizenship or permanent residence or 183 days of presence, and the Mainland at domicile and 183 days. The three tests differ (applies: all three places).

The OECD standard for the automatic exchange of financial account information for tax purposes. Financial institutions identify account holders' tax residence, report to the local tax authority, and the tax authorities then exchange the information (applies: all three places).

Hong Kong's name for the CRS mechanism. The relevant amendment ordinance took effect on 2016-06-30, and the list of reportable jurisdictions includes the Mainland (in the group starting 2018); the IRD web page prevails (applies: Hong Kong).

A tax jurisdiction on the list published by the Hong Kong IRD, for whose residents' accounts Hong Kong financial institutions must report information. Mainland China is in the group starting 2018, with the first reporting period 2017-07-01 to 2017-12-31 (IRD) (applies: Hong Kong).

A category of covered account under CRS. Both the Hong Kong FAQ and the Singapore CRS regulations include cash value insurance contracts and annuity contracts, and insurers report the year-end cash or surrender value (applies: both places).

An insurer that carries reporting obligations under CRS. The Singapore regulations cover licensed insurers that issue cash value insurance contracts or annuity contracts; the Hong Kong FAQ lists it among the covered financial institutions (applies: both places).

A financial institution that must identify accounts and report to IRAS under Singapore's CRS, by 31 May each year; a licensed insurer issuing cash value insurance contracts is a specified insurance company (IRAS) (applies: Singapore).

The account holder's formal declaration of tax residency to a financial institution. The Hong Kong FAQ says it should generally be updated within 30 days of a change in circumstances, and that knowingly or recklessly providing false information is an offence (applies: both places).

The updated version of CRS. Singapore applies it from 2027-01-01, with exchanges expected from 2028; Hong Kong proposes implementation from 2028-01-01, with the bill awaiting passage and the legislative timetable prevailing (applies: Singapore, Hong Kong).

A tax on a deceased person's estate. Hong Kong abolished it from 2006-02-11, and Singapore removed it for deaths on or after 2008-02-15; an owner who is a resident of another jurisdiction is subject to that jurisdiction's rules (applies: Hong Kong, Singapore).

Hong Kong profits tax is charged only on business profits sourced in Hong Kong, and profits from the sale of capital assets are excluded from assessable profits. Whether an activity is trading in nature is judged case by case (applies: Hong Kong).

Under Mainland individual income tax, a resident individual's foreign-sourced interest, dividends, bonuses and similar income are not combined with domestic income and are computed separately, with filing between 1 March and 30 June of the following year (MOF/STA Announcement No. 3 of 2020) (applies: Mainland).

A Mainland regulatory term for an overseas policy sold or signed within the Mainland. According to the former China Insurance Regulatory Commission's 2016 warning (reported second-hand), such policies are protected neither by Mainland law nor by Hong Kong law (applies: Mainland).

The application form a Mainland individual must complete to buy foreign currency, which includes the requirement that the funds may not be used for overseas life insurance and other capital-account items not yet opened (SAFE Xiamen Branch, 2021-10; SAFE's current rules prevail) (applies: Mainland).

Article 4 of the Mainland Individual Income Tax Law lists insurance compensation among items exempt from individual income tax. Whether policy dividends and surrender gains fall within it is for the competent tax authority and professional advice (applies: Mainland).